9911796707
TMI Blog1983 (6) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... 4-6-1981 and levying penalty of ₹ 5,000/- on the appellants under Rule 173Q of the Central Excise Rules, 1944 for being involved in the aforesaid offence. Consultant, Shri N.D. Khosla, who appeared for the appellants has explained how the skull scrap, runners and risers etc. arise out of the manufacture of steel ingots in the factory of the appellants. He has stated that the scrap thus produced is utilised again and again in the manufacture of steel ingots and this practice had been going on for the past several years. The main contention advanced by the appellants is that since the scrap is produced from scrap only and since both the types of scrap are classifiable under the same item namely, 26 of the Central Excise Tariff, there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Collector and hence his order is therefore liable to be set aside. He has also explained that the quantity of scrap arrived at was obtained by the Central Excise Officers from the Form IV Register of the appellants and this would also show that there was no suppression of facts by them. He has further pleaded that Form IV was a statutory record and this was required to be maintained as per the Central Excise Rules. As regards the Collectors' order of levy of penalty, he has pointed out that there was no contravention of Rule 9 or any other rules; therefore, Rule 173Q was not attracted. He has also relied on judicial pronouncements in this behalf to say that the levy of penalty was not justified. He has accordingly requested for setting as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l scrap is non-duty paid and therefore, duty should be charged on the fresh scrap which arises in the production of steel ingots and castings. Therefore, so far as the fresh melting scrap is concerned, it is seen that the classification is under 26, C.E.T. which is the same as the classification of the old scrap from which it was manufactured. Therefore, there has not been a production of our new article satisfying the definition of `manufacture' as per Section 2(f). In this view, there cannot be any levy of duty on this scrap as contended by the appellants. Since no duty is leviable, the Collectors, order for levying of duty and penalty is not correct. Therefore, it is not necessary for us to go into the other submissions of the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X
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